Marketing part 2 exam 2

Learning is the change in

An individuals behavior arising from experience and occurs through interplay of drives, stimuli, cues, responses, and reinforcement

product

Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need

individual product and service decisions

Communicate and deliver benefits by product and service attributes. Quality Features Style and design

Product Features

Competitive tool for differentiating a product from competitors' products Assessed based on the value to the customer versus its cost to the company

Types of Buying Decisions

Complex buying behavior, dissonance reducing buying behavior, habitual buying behavior, and variety seeking buying behavior

Market Segmentation

Dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors, and who might require separate products or marketing programs Needs, wants, and behaviors

How can a company identify new features and decide which ones to add to its product?

It should periodically survey buyers who have used the product and ask these questions: How do you like the product? Which specific features of the product do you like most? Which features could we add to improve the product? The answers to these questions provide the company with a rich list of feature ideas.

How to Select a customer to serve:

Market Segmentation &

Samsung's bulging Galaxy mobile devices line now offers a size for any need or preference, including smartphones, "phablets," tablets, and even a wristwatch-like wearable smartphone, the Galaxy Gear. what is this an example of?

Product line stretching and filling

psychological factors

Selective attention, selective distortion, selective retention

What is a product that could be convenience, shopping, and specialty?

Students might realize that a camera could fall into several categories depending on the buyer and the situation. Certainly, if you are on vacation and you forgot your camera, you would pick one up at a convenience store, pharmacy, or maybe the hotel store. If you were a professional photographer, a camera purchase could easily be specialty if you were buying a $5,000 camera. Other examples might include mats for the floor of an automobile, tires, or a fan.

what the benefits might be for the seller of a strong brand.

This will include segmentation, positioning, and the ability to communicate product features.

The 2 questions asked in a marketing strategy

Who and what are we going to serve them

Product line stretching occurs when

a company lengthens its product line beyond its current range − downward, upward, or both ways.

There has been a long history of legal concerns about packaging and labels due to

a failure to describe important ingredients or include needed safety warnings.

Product line

a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges.

Most major new innovations are unsought until the consumer becomes aware of them through advertising. By their very nature, unsought products require

a lot of advertising, personal selling, and other marketing efforts.

service

a product that consists of activities, benefits or satisfaction that is essentially intangible and does not result in the ownership of anything

At the second level, product planners must turn the core benefit into an

actual product. They need to develop product and service features, a design, a quality level, a brand name, and packaging.

Product support services augment

actual products

Product line filling involves

adding more items within the present range of the line for earning extra profits, satisfying dealers, using excess capacity, being the leading full-line company, and plugging holes to keep out competitors.

By contrast, innovative packaging can give a company an

advantage over competitors and boost sales. For example, Puma replaced the traditional shoebox with an attractive and functional yet environmentally friendly alternative—the Clever Little Bag shown in this slide.

Total quality management (TQM) is

an approach in which all of the company's people are involved in constantly improving the quality of products, services, and business processes.

Traditionally, the primary function of the package was to hold and protect the product. In recent times, however, packaging has become

an important marketing tool as well. Increased competition and clutter on retail store shelves means that packages must now perform many sales tasks—from attracting buyers, to communicating brand positioning, to closing the sale.

Specialty products

are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort. Medical services Designer clothes High-end electronics

Unsought products

are consumer products that the consumer does not know about or knows about but does not normally think of buying. Life insurance Funeral services Blood donations

Industrial products

are those products purchased for further processing or for use in conducting a business. Materials and parts Capital items Supplies and services

Finally, product planners must build an

augmented product around the core benefit and actual product by offering additional consumer services and benefits.

Because of their importance in the world economy, we will look at services more closely later in this chapter. Examples include

banking, hotel services, airline travel, retail, wireless communication, and home-repair services.

A company's market offering often includes

both tangible goods and services.

A company can expand its product line in two ways:

by line filling or line stretching

line filling is overdone if it results in

cannibalization and customer confusion. The company should ensure that new items are noticeably different from existing ones.

Product mix

consists of all the product lines and items that a particular seller offers for sale. Width Length Depth Consistency The Clorox Company has a nicely contained product mix consistent with its mission to "make everyday life better every day."

Two broad classes of products, which are what?, are based on the types of consumers that use them

consumer and industrial products Broadly defined, products also include other marketable entities such as experiences, organizations, persons, places, and ideas.

If a consumer buys a lawn mower for use around home, the lawn mower is a If the same consumer buys the same lawn mower for use in a landscaping business, the lawn mower is an

consumer product. industrial product

convenience products

consumer products and services that customers usually buy frequently, immediately, and with minimal comparison and buying effort newspaper candy fast food

Consumer products differ in the ways

consumers buy them and, therefore, in how they are marketed

Consumers view a brand as an important part of a product, and branding can add value to a consumer's purchase. Customers attach meanings to brands and develop brand relationships. Branding has become so strong that today hardly anything goes unbranded. Brand names help

consumers identify products that might benefit them and say something about product quality and consistency.

products and services are becoming more commoditized. companies are now creating and managing

customer experiences with their brands or company

they define quality in terms of creating

customer value and satisfaction.

Developing a product or service involves

defining the benefits that it will offer.

Packaging involves

designing and producing the container or wrapper for a product.

Shopping products are usually

distributed through fewer outlets but provide deeper sales support to help customers in their comparison efforts.

Age and life-cycle segmentation

dividing a market into different age and life-cycle groups

geographic segmentation

dividing a market into different geographical units, such as nations, states, regions, counties, cities, or even neighborhoods

Income segmentation

dividing a market into different income segments

Gender segmentation

dividing a market into different segments based on gender

Companies located at the upper end of the market can stretch their lines

downward.

Segmenting Consumer Markets

geographic, demographic, psychographic, behavioral

Poorly designed packages can cause

headaches for consumers and lost sales for the company. Think about all those hard-to-open packages and overpackaging. Overpackaging creates an incredible amount of waste, frustrating those who care about the environment.

Consistency

how closely the various product lines are in end use, production requirements, or distribution channels.

Companies are realizing the power of good packaging to create

immediate consumer recognition of a brand. In a highly competitive environment, packaging may be the seller's last and best chance to influence buyers.

For many companies, labels have become an

important element in broader marketing campaigns. Labels and brand logos can support the brand's positioning and add personality to the brand.

Product line length

is the number of items in the product line. Line stretching Line filling

Product mix depth

is the number of versions offered of each product in the line.

Product mix length

is the total number of items the company carries within its product lines.

Shopping products

less frequently purchased consumer products and services that the customer compares carefully on suitability, quality, price, and style. Furniture Cars Appliances

Product quality has two dimensions

level and consistency.

Product safety and growing environmental concerns have become a

major packaging concern.

At the other extreme are pure services, for which the examples?

market offer consists primarily of a service. Examples include a doctor's exam and financial services

Products are a key element in the overall

market offering Marketing mix planning begins with building an offering that brings value to target customers. This offering becomes the basis on which the company builds profitable customer relationships

What are the major steps in designing a customer driven marketing strategy

market segmentation, targeting, differentiation, and positioning STP

Good design doesn't start with brainstorming new ideas and making prototypes. Design begins with

observing customers, deeply understanding their needs, and shaping their product-use experience. Product designers should think less about technical product specifications and more about how customers will use and benefit from the product.

Being the first producer to introduce a valued new feature is

one of the most effective ways to compete.

Many companies now use a sophisticated mix of

phone, e-mail, online, social media, mobile, and interactive voice and data technologies to provide support services that were not possible before. For example, Lowe's has equipped employees with 42,000 iPhones filled with custom apps and add-on hardware, letting them perform service tasks such as checking inventory at nearby stores, looking up specific customer purchase histories, sharing how-to videos, and checking competitor prices—all without leaving the customer's side.

A company may stretch downward to

plug a market hole that otherwise would attract a new competitor or respond to a competitor's attack on the upper end. Or it may add low-end products because it finds faster growth taking place in the low-end segments.

there are important decisions in the development and marketing of individual products and services. We will examine decisions about

product attributes --> branding --> packaging -->labeling --> and product support services.

A product can be offered with varying

product features. A stripped-down model, one without any extras, is the starting point. The company can then create higher-level models by adding more features.

The major product line decision involves

product line length—the number of items in the product line. The line is too short if the manager can increase profits by adding items; the line is too long if the manager can increase profits by dropping items. Managers need to analyze their product lines periodically to assess each item's sales and profits and understand how each item contributes to the line's overall performance.

Product quality is one of the marketer's major positioning tools. Quality affects

product or service performance; thus, it is closely linked to customer value and satisfaction

Customer service is another element of product strategy. A company's offer usually includes some

product support services, which can be a minor part or a major part of the total offering.

Consumer products are

products and services bought by final consumers for personal consumption. Convenience products Shopping products Specialty products Unsought products

Federal regulations require sellers to

provide detailed nutritional information and regulate the use of health-related terms such as low fat, light, and high fiber. Sellers must ensure that their labels contain all the required information.

The distinction between a consumer product and an industrial product is based on

purpose for which the product is purchased. If a consumer buys a lawn mower for use around home, the lawn mower is a consumer product. If the same consumer buys the same lawn mower for use in a landscaping business, the lawn mower is an industrial product.

Beyond quality level, high quality also can mean high levels of

quality consistency. Here, product quality means conformance quality—freedom from defects and consistency in delivering a targeted level of performance. All companies should strive for high levels of conformance quality.

In developing a product, the marketer must first choose a

quality level that will support the product's positioning. Here, product quality means performance quality—the product's ability to perform its functions.

Today, companies are taking a

return-on-quality approach, viewing quality as an investment and holding quality efforts accountable for bottom-line results.

Segmentation vs stereotypes

saying your a part of this group Bc you behave this way. Stereotypes put you in a group Bc they say you should behave this way from group identity

Products include more than just tangible objects, such as cars, computers, or mobile phones. Broadly defined, products also include

services, events, persons, places, organizations, ideas, or a mixture of these.

The Fair Packaging and Labeling Act of 1966

set mandatory labeling requirements, encouraged voluntary industry packaging standards, and allowed federal agencies to set packaging regulations in specific industries.

Branding also gives the seller

several advantages. The seller's brand name and trademark provide legal protection for unique product features that otherwise might be copied by competitors. Branding helps the seller to segment markets.

Labels range from

simple tags attached to products to complex graphics that are part of the packaging

At one extreme, the market offer may consist of a pure tangible good, such as

soap; no services accompany the product.

Buyers normally do not compare

specialty products. They invest only the time needed to reach dealers carrying the wanted products.

style describes

the appearance of the product.

Product quality refers to

the characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs. Total quality management Return-on-quality Quality level Quality consistency

These product mix dimensions provide the handles for defining

the company's product strategy and increasing business.

Product planners need to think about products and services on three levels (see Figure 8.1). Each level adds more customer value. The most basic level is the

the core customer value, which addresses the question: What is the buyer really buying?

Support services are an important part of

the customer's overall brand experience. Keeping customers happy after the sale is the key to building lasting relationships.

Brand

the name, term, sign, or design or a combination of these, that identifies the maker or seller of a product or service.

Product mix width

the number of different product lines the company carries.

Labels identify

the product or brand, describe attributes, and provide promotion.

selective distortion

the tendency for people to interpret information in a way that will support what they already believe

selective attention

the tendency for people to screen out most of the information to which they are exposed

selective retention

the tendency to remember good points made about a brand they favor and forget good points about competing brands

Another way to add customer value is through

through distinctive product style and design. Design is a larger concept than style.

Design contributes

to a product's usefulness as well as to its looks.

Labeling has been affected in recent times by

unit pricing, open dating and nutritional labeling.

Companies can also stretch their product lines

upward. Sometimes, companies stretch upward to add prestige to their current products. Or they may be attracted by a faster growth rate or higher margins at the higher end.

The answers to these certain questions provide the company with a rich list of feature ideas. The company can then assess each feature's

value to customers versus its cost to the company. Features that customers value highly in relation to costs should be added to its product